Nascon Allied Industries, a salt maker in Nigeria, has recorded a 17 percent decline in after-tax profit to N4.84 billion in the first half of 2024 despite revenue growth.
The firm’s after-tax profit dropped to N4.84 billion in the first half of 2024 from N5.82 billion in the same period of 2023. However, revenue increased to N50.43 billion from N38.2 billion.
“Despite robust revenue growth, the results highlight challenges from macroeconomic headwinds that have outweighed efficient cost management strategies. Over the rest of 2024 estimated, we maintain our view that NASCON will sustain strong revenue performance due to increased selling prices and volume growth from enhanced market penetration initiatives,” analysts at Cordros Securities said.
“However, heightened cost pressures stemming from the highly inflationary environment remain a potential headwind to earnings growth. Our estimates are under review,” they stated.
Nascon Allied Industries’ half-year results reveals 54 percent growth in administrative expenses, 48 percent growth in cost of sales, and 19.4 percent growth in distribution costs.
The firm’s cost of sales grew to N28.4 billion in the first half of 2024 from N19.2 billion in the same period of 2023.
Distribution costs increased to N9.85 billion from N8.25 billion and administrative expenses grew to N3.12 billion from N2.02 billion during the period reviewed.
Total assets grew to N84.8 billion from N68.5 billion while total liabilities grew similarly to N52.5 billion from N46.3 billion.
Cash and cash equivalents dipped to N12.2 billion from N16.4 billion during the comparable periods.
Movements in cash and cash equivalents reveal that net cash from operating activities stood at a negative N10.04 billion from a positive N7.17 billion.
Net cash from investing activities stood at a negative N1.24 billion from a negative N363.7 million. Net cash used in financing activities dropped to N2.04 billion from N3.43 billion.
Basic and diluted earnings per share dipped to N3.59 from N4.39.
Chris Ogbechie, Olakunle Alake, and Hajia Fatima, Wali-Abdurrahman, were reelected as non-executive directors at Nascon Allied Industries Plc’s annual general meeting which was held on May 23, 2024.
There was the amendment of the Articles of Association to permit the holding of general meetings virtually which was approved at the meeting.
“The issuance of bonus shares in the proportion of 1 new ordinary share of 50 kobo for every 50 existing ordinary shares of 50 kobo was approved,” the firm said in a release on NGX.
Nascon Allied Industries’ Apapa refinery which is located in the Apapa Port of Lagos, was commissioned in 2001. The Port Harcourt refinery located in the seaport in Rivers State was commissioned in 2003.
The former Oregun plant, commissioned in 2004 to produce refined salt, was converted to a fleet workshop in 2021 with the commissioning of the new state-of-the-art refinery at Salt Village, Apapa.
“We strategically decided in 2011 to grow the company through new product lines. We took advantage of our existing site in Ota and we commissioned a state-of-the-art Seasoning plant in 2014,” the firm said in a statement.
“Our plants are primarily powered through the National Grid supported by gas and diesel-fueled generators, with a combined capacity to generate 6.1MW of power,” it said while adding that as a member of the Dangote Group of companies, Nascon Allied Industries’ is squarely committed to achieving the mission and vision of the Group through our products and every interaction.
NASCON Allied Industries Plc is Nigeria’s refiner and distributor of household, food processing, and industrial-use salt. The company has since evolved to include Seasoning production. It has facilities in Lagos State (Apapa), Ogun State (Ota), and Rivers State (Port Harcourt).
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